Regulatory capital requirement under Basel, the ability to perform of Vietnamese commercial banks

Abstract

This study aims to analyze whether Vietnamese commercial banks may feasibly apply the regulation of Basel in the next few years. The study examines 10 Vietnamese commercial banks, which have been selected by The State Bank of Vietnam (SBV) to apply Basel regulation, during the period from 2003 to 2013. By employing the multi - regression, permutation - test and Granger - causal, the results show that adjusted turnover of loans, expenditure for interest and leverage would have an impact on banks' capital structure. Additionally, if both turnover of loans and expenditure for interest could be controlled as the same level of 2010, Vietnamese commercial banks may achieve the benchmark of the Central Bank.